Tuesday, November 30, 2010
Huge pay Gap is a Ticking Time Bomb
In 1918 the richest 1% earned 19% of all income- that was around 19 times the average wage at that time. But future decades saw a gradual decline as income differences lessened slowly but surely. So in 1935 the percentage was 14%, by 1950, 12%, 1960 to 9%, 1970, 7% and by 1980, 6%. After taxes this figure was a mere 4%. This evening out had occurred without any intervention; as Dorling suggests, this ‘process towards a more equal society seemed inexorable, an almost natural consequence of an advanced democracy.’ Indeed this equalisation seemed itself part of the post-war political consensus: inequality was undesirable and was to be reduced.
But all this changed after 1979. It was not just Thatcher’s fault, as the examples of huge private sector pay had crossed the Atlantic, as did the economic philosophy which underpinned it. By 1983 the top 1% was receiving 7%, by 1992 it was 10%, by 1997 12%, by 2003 13% and 2005 16%. Quite possibly now the figure is back up to 18%. All the progress since the end of World War I- about 60 years- had been virtually reversed in half that time.
But while the averages are shocking, particular examples are hugely more so. While police officers earned ££7,358 in 1980, by 2009 this had increased to £38, 744. Not so surprising you think, but look at ther average salary of a FTSE CEO, from £85, 000 to a thumping £4.9million, 200 times the average take-home pay. On top of this we have Bart Hecht of Reckitt Benckiser who gets £96.2 million a year (nearly 4000 times the average wage). Moreover we hear that the bankers' who started the global meltdown are now receiving their bgonuses on a 'business as usual' basis.
Opinion p[olls show trhat only 1% of Britons think such pay is justified. British people are fairly tolerant, complacent, even placid people compared with some but I genuinely feel this sense of outrage at differential and unjustifiable rewards awarded to often less than brilliant top executives, will well up and extract a condign price some time in the future.
Saturday, November 27, 2010
British Attitudes to Work Midway Between Europe and USA
As his biographer Jose Harris records, he was unconvinced by talk of a British work ethic, declaring the idealisation of “useful toil” a trick of the upper classes to promote industry among the lower classes. The poor had no moral duty to work, he argued: it was for officials to design a system that demonstrably rewarded work.
Precisely where to place assistance so that it does not encourage idleness, is a crucial calculation for Conservatives who tend to doubt the commitment to work of benefit recipients. Iain Duncan Smith(IDS) is suggesting that those on benefits who clearly refuse work should lose some of their benefits for up to three years. The number of jobless on benefits is indeed, worryingly high: 1.4 million have spent nine of the last ten years on unemployment benefit. IDS has called it a it a:
“sin” that millions of jobs had been taken by foreigners under the previous Labour government, because Britons were not “capable or able” to do so.
Bagehot quotes fascinating survey figures on British attitudes to work. UK respondents to the International Social Survey Programme registered the lowest rating of all national groups for, 'commitment to work for its own sake'. But in addition to this, British responses to a recent Pew survey suggested we think poverty is caused by laziness, with a penchant for blaming immigration as well. Indeed:
The same survey shows the British to be less convinced than any other nation in the European Union that poverty can be tackled with increased social benefits; they prefer to offer the poor work, training and regeneration schemes..
Like the Americans, moreover, we tended to answer that 'success in life' is down to our own efforts and not to 'forces outside our control', a solution favoured by the French, Germans Italians and Spanish.
It is hard to avoid Bagehot's somewhat contradictory conclusion that we 'don't much like work, but like the work shy even less.'
Tuesday, November 23, 2010
Ireland Poses Difficult Questions forOsborne
Despite Europhobic complaints that Britain is paying to rescue the despised euro single currency, Britain, in fact, will be helping Ireland in order to help itself. British banks' lending to Ireland, at €149bn, is the highest in the EU. An Irish collapse would hammer British banks. The two neighbouring economies are utterly intertwined, not least because of Northern Ireland, and British trade with and exports to Ireland are huge.
But there is another reason why Ireland is interesting: it is a good example of how the current government's cut the deficit policies have worked in practice. as Simon Hoggart points out:
For years Ireland was the poster boy for British right-wingers, having used low taxes to boost the economy and then, when things went bad, deploying massive cuts. And things went wrong anyway! The leeches sucked out the blood, but they didn't cure the patient.
Hoggart goes on to quote Alan Johnson's comments in response to Osborne:
Alan Johnson, who is making a surprisingly good fist of the economic brief, pointed out that Ireland had followed the Tory policies without any success at all. "The private sector did not take up the slack," he said. He reminded Mr Osborne of what he had said back in 2006: "We should look and learn from across the Irish Sea." He had asked rhetorically what had brought about the Irish miracle, and how could we mere British copy it?
Sunday, November 21, 2010
Oh Lor! It's Another Royal Wedding for the Media to Obsess About
Suppose I'm not that moved by the royal engagement but it's clear that many are. The Economist thinks Kate Middleton strikes the right balance between glamour and stability. It reckons Diana was too much on the former and too little on the latter but Kate is just about on the money(excuse the possible pun). Her middle class origins are held to be a 'plus' despite the snobby sneers of many monarchists that a 'trolley dolly' Mum and parents in 'trade' to boot is not quite up to snuff for a future queen. The journal concludes Kate's 'ordinary' background in a three children nuclear family is all to the good.
I thought it wise to consult a newspaper I don't really respect on this topic too- you guessed, the Daily Mail- and, to my surprise, found it extremely interesting. Its Harris poll(see above) on the forthcoming event revealed some fascinating things about public attitudes.
1. Majorities think William wil make a good king and that the event will 'cheer the nation'.
2. A majority think the royals should pay for the wedding themselves and that it should be 'modest'- so far so unremarkable.
3. On the subject of whether Charles should 'step aside' to allow his son to become the next monarchy (an oft bruited idea in the tabloids) 48% think 'yes' but a substantial 32% 'no'.
4. 56% oppose the idea that the country would be 'better off' without a monarchy.
5. 49% think it a 'good thing' Kate is a 'commoner' but 48% 'don't know or don't care'
6 If Charles became king should Camilla be queen? Only 14% said 'yes' and a surprising 52% 'no'. Oddly the Economist asserted that 'the public had accepted Camilla, Prince Charle's former mistress'- only up to a point, Lord Copper.
7 Finally a majorities thought the marriage would 'strengthen the monarchy' and that the wedding day should be a bank holiday.
On the basis of these attitudes the wedding should serve to be excellent PR for the of tarnished royals and, even, just a little, a distractioon for the nation from the austerity which characterises the present time. We can be sure the media will do its bit to ensure that both things are likely to happen.
Thursday, November 18, 2010
Tony Blair's Journey
Iraq This was the issue which sunk him and reinforced all those accusations regarding trust and veracity which many felt the invasion prompted. It's clear from the memoir that Blair was buoyed up by his successes in Kosovo- where scores of children are now named after him- and Sierra Leone. In both cases bad men were brought to trial as a result: Milosevic and Charles Taylor. 9-11 arrived just after this success and it was 'natural' I suppose, that Blair should think his liberal intervention strategy was equally applicable. He does not mention God at all in his book (so not even a reference in the index!), but Blair did suffer from a species of messiah complex whereby he saw himself as someone who might refashion the world for the better. A reviewer of Bush's recent memoir in the Observer makes this shrewd observation:
Both men have an evangelical sense of grace within that makes their choices immune from criticism because, whatever the outcome, the intention was honest. It is a brilliantly circular and impregnable defence – the test of a policy is not whether it works, but whether it is morally authentic, and the arbiter of authenticity happens also to be the author of the policy.”
TB-GB Blair's relations with Brown will dominate any history of the domestic agenda of New Labour and Blair does not shrink from expressing how "maddening" he could be or how "zero" his emotional intelligence. But he also acknowledges the huge debt Labour owed to his Chancellor and recalls the days when they behaved almost like "lovers" in pushing out visitors to their room so thay could carry on their conversations. He admits he promised to go at the end of the second session but only if Gordon promised to support his domestic agenda; when he signally failed to do so, Blair resolved to stand again in 2005. This kind of stands up but I am agog to read what Gordon will say on these disputed issues. It seems clear Blair did not think Brown had to stuff of a good prime minister and I fear he is right, though why then, did he not do more to encourage a protegee to stand against him and allow Brown the 'coronatioon' he craved?
Style of book
Much has been written of Blair's risible 'cliche ridden' style. I would agree with some of this; the manuscript would have benefitted greatly from the attentions of a good editor. It is rather written in the style of a 'celebrity' autobiography but it is accessible and it is authentically his voice. It is also very honest in parts-his frozen fear when realising he was prime minister and his terror of PMQs- and the whole book is studded with, for this reader, hugely revealing apercus about the business of politics. On balance it's a great read as long as you follow this cynical but necessary precept: don't believe everything he says.
Monday, November 15, 2010
AV Referendum Bill at Risk of Defeat
'excludes local people and increases the suspicion that our poli9tical system is being hijacked for party political advantage'
The allparty committee on the constitution:
Suggests that the changes, which are designed to create numerically equal constituencies of around 75,000 voters, risk diluting democracy by increasing the power of the executive at the expense of parliament. "We are concerned that the [reform] bill could possibly result in the executive's dominance over parliament being increased," the report states. "This is an unsatisfactory basis on which to embark on the
Falconer is trying to get the bill classed 'hybrid', a ploy to get it referred to a Lords committe where it would languish for months and prevent the referendum being held May 2011. The bill however, is definitely comprised of two differing elements: the AV bit and the bit proposing to reduce MPs by 50 and equalize constituency sizes at about 75,000 voters each. All these latter measures would reduce the bias in the system which presently favours Labour.
In the same issue of the paper Tony King from Essex University attacks the reduction in MPs as something which will be provide a second class service to voters and reduce the ministerial 'talent pool'. Meanwhile in the Guardian today Jackie Ashley argues that Labour should realise that AV is in their interests, firstly because if it's passed Cameron will have suffered a grievous defeat and secondly because:
AV makes a Tory landslide less likely and a hung parliament or an opposition victory slightly likelier. That's good for Labour. It also means that at some point Labour might find itself having and wanting to do a deal with the Lib Dems. For the first time since the election, Labour and Lib Dem activists would have found themselves fighting on the same side during an AV campaign. It builds a few bridges, which might be very useful later.
Thursday, November 11, 2010
Is this 'Just the Beginning?'
Given the relatively liberal setting in which the cuts have been made- poor students receive more help and the threshold for repayment has been raised from £15K to £21K- such robust protest would seem to presage much more of the same on this the six month anniversary of the Coalition's creation. So far people are still digesting the scope of the cuts and few of them have had a chance to bite. Once the pain is felt I think we will see many more demonstrations and quite possibly more violent protests. It is often said British political culture is relatiovely calm and peaceful compared to the volatile French and the even more so Mediterranean Greeks. However, the poll tax riots in 1990 showed that while the Brits are slow to anger, once their blood is up they can riot as much as anyone in Europe. I tend to think The Guardian's headline was then more relevant to the future than the Telegraph's.
It's unfair for the Coalition to receive all the blame for cuts any government would have had to impose to some extent- though the depth and timing of such cuts is of course debatable- but, as Labour discovered with the Economic recession and the Expenses scandal, incumbent governments tend to be balmed for bad things which happen on their watch. I think Coaliton ministers should start getting measured up for tin hats.
Monday, November 08, 2010
Coalition to face first Electoral Test in Oldham Byelection
There are some, like the Tory, Nick Boles MP who would wish the coalition to be formalised into an alliance to fight in 2015. Oldham would be an interesting trial run for that idea. Labour lost the election but the majority of votes cast were not for the Conservative candidate. It seems both coalition parties will fight the contest separately but with Lib Dems at only 10% in a recent poll I would imagine they will have little chance.
If Labour 'retain' it there will be much celebration on the left but will voters elect a party which fooled tham last time out? Quite possibly Lib Dems in the constituency will urge voters to vote Tory, but up north after the recent cuts package I'd doubt that has much traction. Mind you, the contest will not be held until Woolas's appeal against disqualification has been heard so we'll have to be patient until then.
Saturday, November 06, 2010
AV Referendum Proving Controversial
"The referendum should have been held on its own day, when the yes and no campaigns could have argued it out. Our sole priority has to be, and will be, winning in Scotland, and Wales, and doing well in the local elections. It would be a recipe for chaos and confusion if Labour candidates were also supporting AV in their literature. The election and referendum campaigns have to be separate and distinct."
Listening to The Week at Westminster this morning, the point was emphasised that this bill is in two parts. The first section deals with the referendum and has ben passed but the second is concerned with reducing the number of MPs from 650 to 600. There is quite a bit of resistance to the latter as every constituency in the country will be affected and boundaries will need to be redrawn. The last thing most MPs want is any messing about with boundaries even if the ostensible reason is to make them more similar in terms of population size. Labour MPs are convinced it will be a Tory jerrymandering stitch up and therefore many oppose the whole package.
In the Lords there will also be opposition and the bill might find it fails ddepending on how Crossbenchers view it as Philip Norton pointed out in his contribution to the programme. Moreover a poll on the isue itself reveals that AV is opposed 43% to 32%, an indicatioon that the Lib Dems have lost the support which might have boosted the 'yes' figure. Yougov's lartest poll showed the junior coalition party on a measly 10%.
Wednesday, November 03, 2010
Republicans Sweep Aside a President who has been Unfairly Condemned
It seems clear that the difference has been substantially contributed by the Tea Party movement and by disillusioned Democrats who felt Obama had not gone far enough in his reforms. Personally I am baffled by both phenomena. The Tea Party was examined Monday evening by Andrew Neil on BBC2 and what an astonishing difference in political culture it revealed! There is no doubt these people are angry with all politicians and feel Obama has become a mortal enemy. One third of Americans, according to survey evidence believe Obama is a Muslim, despite all evidence to the contrary. TP activists cheerfully asserted he was not born in USA and therefore an illegitimate president. When Neil pointed out his birth certificate said otherwise, it was dismissed as a fake. They also cheerfully compared Obama to Stalin, the nazis and Hitler despite Neill pointing out such a discussion in a true 'tyanny' would never be allowed in the first place.
But what really amazed me was the televisual style of Glen Beck, the Fox news presenter- who has allegedly made $35m from his show- and the trick he seems to have of weeping at will. I have never seen such prodigal lachrymosity, even in a young child. His ability to blub to order would be seen as absurd in our culture yet it has made him an icon on the far right in USA. But it's not just him; another activist had tears rolling down his cheeks when Neil suggested the TP movement was to some extent a covert racist attack on a balck president.
As for his Democrat 'supporters' I cannot begin to believe what their guy could have done to please them. He has reformed financial regulation, introduced a historic health care system, which has eluded US presidenmts from Teddy Roosevelt onwards, and presided over a stimulus package which has saved the US economy from imploding. Of course it's the last factor which has been crucial. Voters seldom respond to something unpleasant which has NOT been allowed to happen and incumbent governments almost almost carry the can for things which happen on their watch, even if the economic crisis and huge job losses happened chiefly under the Bush regime.
So I'm depressed about what has happened and, as always, baffled by a political culture so alien to our own despite our common language. My hope is that: the the maverick Tea Partiers will prove an embarrassment for the Republicans as the defeated Christine O'Donnell did and Sarah Palin probably will; they will now have to take some resonsibility for managing the economy and will not be able to slag off Obama's efforts automatically any longer; that the economy will turn around by 2012 when the next president is elected; and that the healthcare reforms will finally become appreciated by then by people who might otherwise have died had they not been covered by health insurance.